Guangxi Huaxi Nonferrous MetalLtd (SHSE:600301) stock performs better than its underlying earnings growth over last five years

Guangxi Huaxi Nonferrous Metal Co.,Ltd (SHSE:600301) shareholders might be concerned after seeing the share price drop 22% in the last quarter. But in stark contrast, the returns over the last half decade have impressed. Indeed, the share price is up an impressive 152% in that time. Generally speaking the long term returns will give you a better idea of business quality than short periods can. Of course, that doesn't necessarily mean it's cheap now.

Since it's been a strong week for Guangxi Huaxi Nonferrous MetalLtd shareholders, let's have a look at trend of the longer term fundamentals.

See our latest analysis for Guangxi Huaxi Nonferrous MetalLtd

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

During five years of share price growth, Guangxi Huaxi Nonferrous MetalLtd achieved compound earnings per share (EPS) growth of 27% per year. The EPS growth is more impressive than the yearly share price gain of 20% over the same period. Therefore, it seems the market has become relatively pessimistic about the company.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

It is of course excellent to see how Guangxi Huaxi Nonferrous MetalLtd has grown profits over the years, but the future is more important for shareholders. This free interactive report on Guangxi Huaxi Nonferrous MetalLtd's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

It's good to see that Guangxi Huaxi Nonferrous MetalLtd has rewarded shareholders with a total shareholder return of 8.5% in the last twelve months. However, that falls short of the 20% TSR per annum it has made for shareholders, each year, over five years. Potential buyers might understandably feel they've missed the opportunity, but it's always possible business is still firing on all cylinders. Before deciding if you like the current share price, check how Guangxi Huaxi Nonferrous MetalLtd scores on these 3 valuation metrics.

Of course Guangxi Huaxi Nonferrous MetalLtd may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Chinese exchanges.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.